Key facts
- US public pensions are investing in AI technologies amid market exuberance and fears of a bubble.
- Nvidia's stock surged from $5.90 in January 2020 to $182 in August 2025.
- CPP Investments committed $225 million for a 50% stake in a data center loan in July 2025.
- AI is being incorporated by companies across sectors to cut costs and attract customers.
- Pension plans are using AI for actuarial assumptions, annuity pricing, and member services.
US public pension funds are increasingly investing in artificial intelligence (AI) technologies, a trend that mirrors a broader market euphoria around the sector. This includes direct investments in companies like Nvidia, whose stock has seen a dramatic rise, and in physical assets such as data centers. For instance, CPP Investments committed $225 million in July 2025 for a stake in a data center loan pre-leased to an AI cloud-computing provider. While AI offers significant opportunities, it also presents substantial risks, reminiscent of the dot-com bubble, where high valuations and expectations may not align with actual returns.